Cambodia Moves to Regulate Virtual Assets Amid Growing Concerns

Cambodian financial regulators have signaled their plans to regulate virtual assets, including cryptocurrency, due to growing concerns about macroeconomic risks and consumer protection. The Securities and Exchange Regulator of Cambodia (SERC) and the National Bank of Cambodia (NBC) issued a joint notice on September 23 highlighting the need for regulation.

The statement noted that the increasing adoption of virtual assets globally has amplified their associated risks, including tax evasion and cyber-crime. It emphasized that regulating such activities could provide opportunities to increase transparency in financial markets, broaden access to financial services, promote economic empowerment, and contribute to public revenues.

The SERC and NBC proposed a harmonized regulatory framework based on three key principles: investor and consumer protection, market integrity, and supporting innovation. Licensed commercial banks will need prior approval from the NBC to provide services related to virtual assets, while other legal entities must obtain a license from the SERC in advance.

The regulators also emphasized that virtual assets are not recognized as legal tender and are not guaranteed by the government or central bank. They warned the public to carefully evaluate the risks associated with any dealings in virtual assets and make informed investment decisions.